Sunday, February 5, 2023

Inflation to cause wage decline globally, warns ILO

According to “The Global Wages Report 2022-2023: The Impact of Inflation and COVID-19 on Wages and Purchasing Power,” monthly wages declined by 0.9 percent in real terms in the first half of 2022.

In the region’s analysis, in North America (Canada and the United States), average real wage growth is set to reach zero in 2021 and decline to minus 3.2 per cent in the first half of 2022.

Meanwhile, in Latin America and the Caribbean, this indicator has decreased to minus 1.4 percent in 2021 and minus 1.7 percent in the first half of the current year.

On the other side of the world, in the European Union, real wage growth is set to rise by 1.3 percent in 2021 and drop to minus 2.4 percent in 2022; And in Eastern Europe, it slowed to 3.3 percent in 2021, and a further 3.3 percent from January to June this year.

For its part, in Asia and the Pacific it is projected to increase to 3.5 percent in 2021 and slow to 1.3 percent in the first half of 2022; And in Central and West Asia, it projects a strong growth of 12.4 per cent in 2021, but will later slow down to 2.5 per cent.

In Africa, data suggests a decline in real wage growth to 1.4 percent in 2021 and 0.5 percent through June of the current year.

In Arab states, projections point to a lower growth of 0.5 percent in 2021 and 1.2 percent in 2022.

With these figures, it is the first time in this century that global real wage growth has been negative, which is why the purchasing power of the middle class has declined and low-income households are particularly affected, the annual ILO study noted. has gone.

The investigation showed that increases in inflation and the cost of living affect low-wage workers to a greater extent, “since this segment of the population invests a greater proportion of their disposable income in essential goods and services that lead to higher growth.” Let’s experience.”

Based on this, the report emphasizes the urgent need to implement well-designed policy measures aimed at maintaining the purchasing power and living standards of salaried workers and their families.

The director general of the organization, Gilbert F. According to Hongbo, many of the global crises we are facing have led to a decline in real wages.

“It has put lakhs of workers in grave jeopardy as they face growing uncertainty,” he asserted.

He also warned that income inequality and poverty would increase if the purchasing power of the lowest wage earners was not maintained.

Nation World News Desk
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